In a risk alert issued Wednesday, the SEC's Division of Review said that some companies' policies and procedures are “not reasonably designed or implemented to address compliance with marketing regulations” and that, as a result, , said it was found that there were gaps in marketing regulations and hindering books and records. Against the rules.
These gaps included policies and procedures such as:
- It contains only general instructions and expectations related to marketing rules.
- You didn't mention the channels your advisor uses to post marketing materials, such as your website or social media.
- Incomplete, not updated, or only updated for certain marketing topics.
- Not tailored to address advisor specific advertising regarding general prohibitions and rules regarding endorsements, endorsements, and third-party reviews.
- It did not adequately address the storage and maintenance of advertising and related documentation, including research documents used to create third-party ratings.and
- We did not implement updates to reflect marketing rules.
The Examiner also noticed deficiencies in the submission of Form ADV, particularly related to third-party evaluations, performance results, and hypothetical performance. Some of the filings contained outdated references to the SEC's previous cash solicitation rules.
The SEC staff also requires investment advisers to make statements that include misrepresentations of material fact, omit material facts necessary to make the statement, or make material statements that may not be substantiated upon examination by the adviser. He also mentioned cases where prohibited advertising materials were used, such as by making statements. Examiner.
The SEC requires that advertisements contain misleading information that leads investors to incorrect conclusions, contain misleading or false performance claims, or contain fair and balanced treatment of material risks and limitations. Said no ads were found.
Examples of unsubstantiated or misleading claims include paid advertising, celebrity endorsements, use of the agency's logo in marketing materials, “in national media” without disclosing SEC endorsement or implied endorsement. “I saw it'' includes an advisor.
